Pantaloon decides against converting warrants

Tuesday, 03 January 2012

The Future Group has announced that the promoters of Pantaloon Retail have decided against converting into equity of the one crore preferential warrants issued to it. Pantaloon, the country’s largest listed retailer, has also forfeited the Rs 100-crores deposit money. It was 25 per cent of the warrant price and transferred to reserves, the company said in a statement to the exchanges. The final date for warrants conversion was December 28 last year.

On June 29 last year Pantaloon issued warrants at Rs 400 to Future Ideas Realtors India, a promoter group company. But later, the stock was trading at two to three per cent premium to conversion price. According to analysts due to the sharp decrease in the stock price rendered it unattractive for the promoters to convert the warrants to equity.

The retailer was looking forward to the approval of FDI, to ease out the pressure and the stock did witness a hike after the government announced the foreign direct investment in retail on November 25, but again dropped to 24 per cent in five trading sessions after the decision was put on hold on December 6 till political consensus is reached.

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